Einhorn’s Greenlight Fund: “We Just Don’t Understand the AI Numbers”
How big can AI spending really get? In a “hold my beer” moment, Meta Platforms has announced a record-shattering $27 billion private-credit deal to fund its Louisiana data center — Wall Street’s largest ever.
But even seasoned investors are struggling to make sense of the math. In our Call of the Day, billionaire investor David Einhorn’s Greenlight Capital — managing over $2 billion — admits it’s “refusing to participate in the excitement” around artificial intelligence, instead putting its faith elsewhere.
About a month ago, Einhorn warned that AI spending numbers are “so extreme that it’s really, really hard to understand them.” The hedge fund legend, who famously shorted Lehman Brothers before its collapse, says the math simply doesn’t add up.
Greenlight’s latest quarterly letter echoes that sentiment:
“When it comes to AI, doing math is essential. The figures simply must add up, and right now the math is… challenging.”
Citing McKinsey’s estimate of $6.7 trillion in global data center spending through 2030, Greenlight notes that massive leverage will likely be required to fund such expansion. The firm calculates that $2 trillion in annual revenue by 2030 would be needed to justify the investments — a target it calls “difficult to reconcile.”
“Something’s got to give,” the letter adds, pointing out that just like during the dot-com bubble, it’s impossible to know when “the last buyer buys and the last short seller covers.”
Despite a difficult year — Greenlight’s funds are up only 0.4% in 2025 versus the S&P 500’s 14.8% gain — the firm remains cautious.
“While others are doing better for the time being, many are taking risks we find hard to get comfortable with.”
The fund sees Coya Therapeutics (COYA) as a bright spot. Greenlight, its largest shareholder, is optimistic about the biotech’s potential FDA fast-track approval for its ALS (Lou Gehrig’s disease) treatment.
“At a time when AI business plans that are little more than PowerPoint slides are valued in the billions, we’d rather bet on Coya — a $100 million company with real science behind it.”
Greenlight also revealed a medium-sized stake in Pacific Gas & Electric (PCG), betting on recovery and state support after years of wildfire-related damage. Meanwhile, its gold exposure — through Green Brick Partners (GRBK) — provided a lift, partly offset by a housing hedge.
The fund exited Teck Resources (TECK) with strong gains but expressed disappointment over its coal spinoff and merger with Anglo American (AAL).
Einhorn’s final word:
“This remains the most expensive market we have ever experienced. The best option right now is to stay cautious.”
